Delinquency Rears Its Ugly Head Again

After receding sharply in the fourth and first quarter delinquency is rearing its ugly head again. Last month, 60+ day delinquency neared the 3% mark for the first time in eleven months. According to CardData, delinquency for the May period hit 2.99%, compared to 2.75% in the prior quarter and 3.07% one-year ago. The rise has been attributed to higher minimum payments coupled with rising interest rates on other personal and mortgage loans. It is expected that charge-offs will slowly rise through the rest of this year, significantly impacting credit card profits in the fourth quarter.

60+ DAY DELINQUENCY
Dec 05: 2.91%
Jan 06: 2.81%
Feb 06: 2.77%
Mar 06: 2.74%
Apr 06: 2.75%
May 06: 2.99%
Source: CardData (www.carddata.com)

Details

Convenience Usage Reverses Course

While monthly payment rates remain at historical highs the number of convenience users has sharply reversed after two years. As of May, only 40% of card account holders pay-off their balances in-full each month compared to 44% two years ago. Over the past decade the number of convenience credit card users or “30-day Wonders” has risen sharply from 29% to more than 40% according to CardData. The recent fall-off is most likely attributed to rising fuel costs and interest rising rates.

CONVENIENCE USAGE
2002: 39%
2003: 38%
2004: 44%
2005: 42%
2006: 40%
Source: CardData (www.carddata.com)

Details

Regulatory Fees Slow IDT Calling Card Sales

NJ-based IDT reported that calling card revenues increased 3.2% when compared to last year’s first calendar quarter. IDT says the U.S. calling card business recorded a $48.1 million accrual for the potential past liability of various telecom regulatory agency fees. IDT has filed an appeal related to the audit findings, and will vigorously contest the imposition of any of these fees. Due to this accrual, gross margins in its calling card business decreased to 7.7% in the first calendar quarter from 20.4% in the prior quarter. For complete details on IDT’s latest results, visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

Details

NOVA Picks Hypercom as Preferred Provider

U.S. Bancorp’s NOVA Information Systems has selected Hypercom as a preferred provider of card payment terminals and associated peripheral devices including the “T7Plus” terminal. To wit, NOVA has launched an aggressive POS field upgrade campaign which has resulted in the replacement of legacy payment devices with newer equipment. NOVA will also initiate “Class A” certification of the “VISA PED”-approved PIN Pad version of the “T7Plus” so that it can offer that terminal to merchants requiring an integrated PIN pad.

Details

NCR Wins 2006 Fraud Prevention Award

“The Banker Technology Awards 2006” has named NCR as the winner of the “Fraud Prevention Innovation in Retail Banking” category. NCR took top honors for its unique security solution for automated teller machine- (ATM) channel software, known as Solidcore for APTRA(TM). This first-of-its-kind approach to controlling the banking-software environment includes countermeasures against potential risks of compromise of the ATM channel, as well as innovative functionality to support regulatory compliance such as Sarbanes-Oxley. Solidcore Systems is a provider of real-time change control solutions for both the enterprise, government and OEM markets.

Details

MasterCard Tops 20,000 QPS Merchant Locations

MasterCard International has announced that more than 20,000 merchant
locations across Canada are enrolled in the MasterCard “Quick Payment
Service” (QPS) program. “QPS” was developed for use in retail and service environments where speed of payment is critical to the transaction, such as movie theatres, parking garages and quick service restaurants. MasterCard “PayPass” and “QPS” work well together for merchants in quick service environments. Any merchant that accepts MasterCard “PayPass” automatically qualifies for a minimum $30 transaction floor limit. This year, MasterCard “QPS” was
expanded to 12 categories including convenience stores, gas stations and
drug stores.

Details

ACS Lands the LA Metro Card Contract

Dallas-based Affiliated Computer Services has signed a five-year, up-to $60 million, contract with the Los Angeles County Metropolitan Transportation Authority to implement and operate a regional transit smart card service center. ACS will implement and operate the Regional Transit Access Pass (TAP) service center, providing services such as cardholder registration, card inventory and distribution, and point-of-sale network management. ACS is a provider of integrated revenue collection solutions to public and private sector operators of tolls, transportation systems, fare collection, and parking facilities.

Details

SoftFob Facilitates Internet Banking

NY-based Intelligent Voice Research has introduced a tool designed specifically to facilitate financial institutions in delivering a secure, multi-factor authentication key code to online consumers anytime, anywhere. The new “SoftFob” tool offers a two-factor authentication system with keys issued in real time, via voice message, email or text message to customers conducting online transactions. “SoftFob” does not require any specialized hardware, works with any operating system and is a totally outsourced solution.

Details

Cap One Names a New U.S. Card Overseer

Capital One has named a new head of its $47 billion U.S. card business. Jory Berson, a fourteen year company veteran, has been promoted to EVP of U.S. Card Operations, effective immediately. Berson most recently served as head of U.S. Card Operations. Capital One says Berson has been involved in every aspect of the card business including marketing, credit management, and operations. He will replace Catherine West, who has accepted the role of EVP/COO and COO for the TX-based J.C. Penney Company. West began heading U.S. Card in 2004 after having previously served as Capital One’s head of U.S. Card Operations. Capital One has 37 million credit card accounts in the USA.

Details

The First Certified EMV Parking Solution Takes Shape

3C Communications International has been selected by Central Parking
System, the Lloyds TSB Cardnet and Masterpark car parks for the
introduction of the first UK certified EMV parking solution chip and PIN
authenticated car park payments. The Central Parking System is the
first parking operator to achieve a chip & PIN implementation,
Masterpark Car Parks are the first local authority off-street service
to introduce a solution certified with the EMV security requirements and
Lloyds TSB Cardnet played a key role in this first UK EMV
implementation, acting as the acquirer bank of the project. 3C provides
card processing solutions for various industry and market segments.

Details

Acies Offers Contactless Incentives

NYC-based Acies Corporation has launched a month-long national contactless payment marketing campaign offering retailers free placement of a “ViVOtech 4000” contactless reader and charge-back protection of up to $50.00 per transaction, with no receipt or signature required. During the month of June, Acies is offering retailers the opportunity to participate in a special promotional initiative, entitled “ABC (Acies Best in Contactless) Program”. To further support its promotional efforts, Acies will also begin hosting a monthly series of value-added tele-workshops exclusively for industry ISOs.

Details